Quote of the Day

“Paul Volcker, a top economist in the Obama Administration and former Federal Reserve Chairman, wants the nation’s banks to be prohibited from owning and trading risky securities, the very practice that got the biggest ones into deep trouble in 2008.  And the administration is saying no, it will not separate commercial banking from investment operations.  Mr. Volcker argues that regulation by itself will not work.  Sooner or later, the giants, in pursuit of profits, will get into trouble.  The Administration should accept this and shield commercial banking from Wall Street’s wild ways..."

John McCain, Dec. 17, 2009
On the Banking Integrity Act of 2009

Quote of the Day II

When banks benefit from the safety net that taxpayers provide, which includes lower-cost capital, it is not appropriate for them to turn around and use that cheap money to trade for profit. And that is especially true when this kind of trading often puts banks in direct conflict with their customers’ interests.

The fact is, these kinds of trading operations can create enormous and costly risks, endangering the entire bank if things go wrong.

We simply cannot accept a system in which hedge funds or private- equity firms inside banks can place huge, risky bets that are subsidized by taxpayers and that could pose a conflict of interest. And we cannot accept a system in which shareholders make money on these operations if a bank wins, but taxpayers foot the bill if a bank loses.

Barack Obama, Jan. 21, 2010
On Additional Reforms to the Financial System (e.g., "The Volcker rule")

McCain's bill calls for a complete ban on investment banking activities by deposit-taking banks; Obama proposes simply to ban proprietary trading and internal hedge funds. So what excuse will McCain find to oppose the milder separation of bank functions?